Ever gotten excited about a house for sale, then looked at the price and thought, “Are they out of their minds?” Yeah, me too.
It can be a disheartening moment when you’re house hunting. And that jaw-dropping asking price might simply seem like an arbitrary, money-grabbing number that’s keeping you from your dream home. But before you dismiss a house for being too expensive, you should know that there are a variety of reasons a property is priced the way it is.
1. What’s happening in your local housing market at any particular moment
- Low inventory creates a seller’s market with aggressive listing prices. A surplus of homes for sale results in overall lower asking prices.
2. The (extremely specific) location of the house
- Similar or even identical houses just streets apart from each other can have wildly different price tags based on things like traffic noise and access to quality schools, shops, and restaurants.
3. The comps
- Historical data plays a huge role in setting a listing price; it’s not a number just pulled out of the air. So find an agent who can interpret that data.
4. The amenities (and overall appeal) of the home
- Clients prefer new construction, brand-name appliances, and large bedrooms—[preferably] at least three on one floor if they have kids—plus a den or office. Additional features such as parking, central air conditioning, outdoor space, and floor plan also affect the sticker price.
5. Age and condition of the home
- If you want a newer, turnkey home, expect to pay more for that.
For more information on what goes into pricing a home go to bmre.us/tip17.
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